What happens to your pension when you die?

What happens to your pension savings when you die depends on whether you’ve started taking money from them yet – and if so, how you’ve chosen to access them. These factors are often called the ‘death benefits’ of your options at retirement.

Nominate a beneficiary

Even before you start claiming your pension pot – or if you’re keeping your pension pot where it is – you should nominate a beneficiary.

This means choosing a person (or people, or organisation) who you would like your pension pot to go to if you die before taking your money – and letting us know who that person is, so that our Trustee can consider your wishes after you’re gone.

If you nominate more than one beneficiary, you should tell us how you’d like your pension savings shared out. For instance, if you want two people to get half of it each, or if you’d like one person to get a quarter and another person to get the other three quarters.

It’s important to make sure we’ve got the right details for your beneficiaries. Check them now in your Online Account…

Once you’ve taken all your money out of your pension pot, you can make arrangements to leave it to someone when you die, by writing a will for example. But if you leave your loved ones money outside of a pension, they may have to pay inheritance tax.And if you spend all of your money after taking it out of your pension, there won’t be anything left to leave to anyone.

If you’re taking your pension pot a bit at a time (no matter whether you’re taking your tax-free cash gradually or up front) – you can nominate a beneficiary.So if there’s still money left in your pot when you die, it could be passed to the person (or people) you’ve nominated.If you’ve already chosen a beneficiary while saving into your pension pot with The People’s Pension – the same beneficiary details will be used once you start taking money out. Or you can update your beneficiary details at any time.With The People’s Pension, any money we pass on to your beneficiary would be paid to them as a single lump sum – we can’t pay it to them as an income, or carry on investing it on their behalf.

What happens when you die depends on what type of guaranteed income you choose.For example, you could chose a single-life income which will end when you die, or a joint-life one that will continue to pay your partner or beneficiary after you’re gone.